lending practices

Change in way they're calculated will be more forgiving of medical debt

(Newser) -
A modification to how one of the most common credit scores is calculated will mean better credit ratings for many Americans, reports the Wall Street Journal . Fair Isaac Corp. said yesterday that it won't place as much emphasis on medical debt when calculating consumers' FICO scores and will turn...
More »

Effort to expand recovery sparks debate on risky lending

(Newser) -
The White House is fighting to make it easier for people with less-than-stellar credit to get home loans, a move insiders say will spur recovery. They're joined by housing advocates who say the improving housing market hasn't reached lower-income and young people. But the plan "would open...
More »

African Americans, Hispanics allegedly got higher rates

(Newser) -
From 2004 to 2009, Wells Fargo allegedly discriminated against African-American and Hispanic borrowers, and now the bank will pay at least $175 million to settle the matter, the AP reports. Wells Fargo is accused of charging such borrowers higher rates for loans, thus violating fair-lending laws. A deputy attorney general...
More »

Doctors fear predatory lending for in vitro procedures

(Newser) -
Poor economy or not, families want children—and with bank credit tight, a specialized industry is reaping the benefits. "Fertility finance" firms provide loans for in vitro fertilizations, which regularly cost more than $20,000. The business looks set to soar this year, insiders tell the Wall Street Journal...
More »

She hasn't paid since '85, vows she's going to die there

(Newser) -
A retired Florida woman who hasn't paid her mortgage since 1985 is engaged in one of the longest foreclosure battles ever. Armed with a stack of legal challenges both legit and frivolous and protected by a 105-pound pit bull, the 71-year-old has successfully staved off six lenders in a cautionary...
More »

Credit scores sink to new lows

(Newser) -
Thanks to the Great Recession, the credit scores of millions more Americans have sunk to new lows. New figures show that an astounding 1 in 4 households are now in the lowest credit category, boosting the number of those considered poor lending risks to 43 million. Even more consumers are...
More »

Bill passes 223-202, with Senate to act next year

(Newser) -
The House today passed a sweeping overhaul of financial regulations that would govern Wall Street and reconfigure the power of the agencies overseeing the banking system. The vote was 223-202, with nearly all Republicans in opposition because of fears over too much government intrusion. The bill is designed to address...
More »

Slumping profits are 'payback' from Main Street whipped by bad practices

(Newser) -
Those concerned about the nation’s banks should forget about the “softly, softly policy” of the Obama administration that has allowed Goldman Sachs to go back to business as usual in spectacular fashion. The real problem, Paul Krugman writes, is banks like Citi and Bank of America that are...
More »

Rate cuts, other moves must eventually be reversed

(Newser) -
In his first term as Fed chairman, Ben Bernanke played the role of savior, lending hundreds of billions to banks and businesses, backing the mortgage market, and cutting interest rates. In his second, Bernanke will have to turn “strict disciplinarian,” reversing earlier moves to respond to a massive...
More »

Trend suggests economy has a long way to go

(Newser) -
Lending is still on the downswing, the Wall Street Journal finds, as an analysis of 15 banks' total loans on offer in the second quarter shows another 2.8% decline. What's worse, more than half of April and May’s loan volume was tied to refinanced mortgages and renewed credit...
More »

(Newser) -
The House today approved legislation to protect credit card holders from hidden fees and sudden rate hikes, Reuters reports. Legislators voted overwhelmingly for the Credit Cardholders' Bill of Rights, a measure banks complain will tighten the amount of credit available and make holding a card more expensive. The Senate is...
More »

Obama backs House bill limiting 'deceptive' practices

(Newser) -
President Obama told senior executives of credit-card firms today that he supports congressional efforts to rein in some of their business practices, the Washington Post reports. Both the House and Senate are working on bills to codify new regulations by the Fed that restrict lenders’ ability to arbitrarily raise interest...
More »

Rules on deceptive practices don't take effect until 2010

(Newser) -
Sen. Chuck Schumer is putting pressure on the Fed and the Office of Thrift Supervision to enact restrictions on the business practices of credit card firms more quickly, the New York Daily News reports. The agencies have drafted new rules banning deceptive practices like hidden fees and retroactive rate hikes,...
More »

Journal says Treasury's tally hides damage

(Newser) -
Banks that received taxpayer aid to restart lending are loaning less than they did before the bailout, a Wall Street Journal analysis finds. The most recent figures available, from February, show a 23% drop in new loans from the lending level in October, when the Treasury Department kicked off TARP,...
More »

'Private art banks' exchange paintings for cash

(Newser) -
With loans hard to come by, some rich Americans are turning to their art collections for quick cash. Rather than sell in a depressed market, collectors turn to a lightly regulated corner of the marketplace that provides capital in exchange for temporary ownership of artwork. While they may look like...
More »

(Newser) -
Banks are enjoying a public bailout of billions of dollars, but they're not using the funds the way the way they were intended—to loan money to kickstart the economy, reports the New York Times. Banks are using the bucks to pay off debts and, in some cases, acquire companies....
More »

Consumer aid package won't budge pickier banks

(Newser) -
With hundreds of billions of dollars pumping into the calcified credit markets, many struggling Americans are expecting to see some relief, but many will be disappointed, the New York Times reports. Banks continue to stiffen loan eligibility requirements even as strapped consumers face deteriorating credit scores, and whole categories of...
More »

(Newser) -
Officials from several US banking regulators are finalizing guidelines for financial firms that will encourage them to lend more and curb executive pay, the Washington Post reports. The Treasury is taking $250 billion in equity stakes in various financial firms, but critics complain the firms are passing the taxpayer money...
More »

Plastic crisis comes hot on the heels of mortgage crisis

(Newser) -
The flattening economy is putting the squeeze on credit card lending just when consumers can least afford it, the New York Times reports. Lenders are putting the brakes on new credit card offers and reining in lines of spending for existing holders, even those with good credit records. The flood...
More »

Fed should ignore critics, hold its ground until markets rebound

(Newser) -
Critics claim the Federal Reserve has been too eager to cut interest rates, and that lax policy has exacerbated inflation. But the Fed should hold its ground, Desmond Lachman argues in the American, until the housing and credit markets are clearly on the rebound. The credit crunch has prompted banks...
More »